This legal document, part of the Minnesota Statutes under the Uniform Commercial Code, governs the right of a customer or any authorized person to stop payment of any item drawn on the customer’s account or close the account. The customer or authorized person must provide an order to the bank with a clear description of the item or account. If multiple signatures are required to draw on the account, any of these persons may stop payment or close the account.

A bank is under no obligation to a customer having a checking account to pay a check, other than a certified check, which is presented more than six months after its date, but it may charge its customer’s account for a payment made thereafter in good faith. History: 1965 c 811 s 336.4-404; 1992 c 565 s 105

(a) A payor or collecting bank’s authority to accept, pay, or collect an item or to account for proceeds of its collection, if otherwise effective, is not rendered ineffective by incompetence of a customer of either bank existing at the time the item is issued or its collection is undertaken if the bank does not know of an adjudication of incompetence. Neither death nor incompetence of a customer revokes the authority to accept, pay, collect, or account until the bank knows of the fact of death or of an adjudication of incompetence and has reasonable opportunity to act on it.

This legal document, governed by the Minnesota Statutes under the Uniform Commercial Code, outlines the customer’s duty to discover and report unauthorized signatures or alterations in banking transactions. It establishes the responsibilities of both banks and customers in handling statements of account and items paid. The document requires banks to either return the items paid or provide sufficient information in the statement of account for customers to identify the items. If the items are not returned, the person retaining them must maintain the capacity to furnish legible copies for seven years.

If a payor bank has paid an item over the order of the drawer or maker to stop payment, or after an account has been closed, or otherwise under circumstances giving a basis for objection by the drawer or maker, to prevent unjust enrichment and only to the extent necessary to prevent loss to the bank by reason of its payment of the item, the payor bank is subrogated to the rights: (1) of any holder in due course on the item against the drawer or maker; (2) of the payee or any other holder of the item against the drawer or maker either on the item or under the transaction out of which the item arose; and (3) of the drawer or maker against the payee or any other holder of the item with respect to the transaction out of which the item arose.

A bank that takes a documentary draft for collection shall present or send the draft and accompanying documents for presentment and, upon learning that the draft has not been paid or accepted in due course, shall seasonably notify its customer of the fact even though it may have discounted or bought the draft or extended credit available for withdrawal as of right. History: 1965 c 811 s 336.4-501; 1992 c 565 s 109

If a draft or the relevant instructions require presentment ‘on arrival,’ ‘when goods arrive’ or the like, the collecting bank need not present until in its judgment a reasonable time for arrival of the goods has expired. Refusal to pay or accept because the goods have not arrived is not dishonor; the bank must notify its transferor of the refusal but need not present the draft again until it is instructed to do so or learns of the arrival of the goods.

This legal document governs the responsibility of a presenting bank when dealing with documents and goods in relation to a documentary draft. It applies specifically to banks presenting a documentary draft. The document outlines the obligations of the presenting bank, including the delivery of documents to the drawee upon acceptance or payment, seeking instructions from a designated referee in case of need upon dishonor, and notifying the transferor of dishonor and the results of efforts to ascertain the reasons for dishonor.

(a) A presenting bank that, following the dishonor of a documentary draft, has seasonably requested instructions but does not receive them within a reasonable time may store, sell, or otherwise deal with the goods in any reasonable manner. (b) For its reasonable expenses incurred by action under subsection (a), the presenting bank has a lien upon the goods or their proceeds, which may be foreclosed in the same manner as an unpaid seller’s lien.

This article may be cited as Uniform Commercial Code–Funds Transfers. History: 1990 c 582 art 1 s 1